Gene therapy would ideally correct a mutant gene precisely without causing changes elsewhere in the genome. Homologous recombination has this potential, but has not yet been successfully used in this context. During the last grant period, we demonstrated correction of a faulty HPRT gene by homologous recombination in clonogenic hematopoietic progenitor cells, and showed that a truncated erythropoietin receptor transgene introduced into the HPRT locus of ES cells can give hematopoietic stem cells (HSC) from the resulting mice an advantage over wild type cells in competitive bone marrow transplantation. Building on this work, we have chosen three aims directed towards correcting mutant human globin genes in mice, but equally applicable to other defects treatable via HSC correction. Specific aim (i1) will test whether ex vivo homologous recombination in HSC can correct mutant genes at (A) the HPRT and (B) the B globin locus. Specific aim (ii) will develop a transgene able to give a controllable in vivo transplantation advantage specifically to HSC when inserted at and site in the genome. Including but not limited to the globin locus. Specific aim (iii) will combine the targeting procedures developed in aim (i) with an advantage sequence developed under aim (ii) to attempt therapy in mice carrying a mutant human beta globin gene (B-O or B-S). Correcting a mutant gene in HSC by homologous recombination, and showing that the simultaneous co-introduction of an advantage transgene into HSC can facilitate their engraftment in an affected donor, would constitute substantial advances both for gene therapy in particular and for bone marrow transplantation in general.